Monday, October 31, 2011

GAYS MILLS - This small village has literally risen, only not from the ashes, but from the Kickapoo River floodwaters of 2007 and ‘08.

The village is about to take a major step in its “uphill” relocation effort with completion of a Mercantile building and a Community Commerce building along Highway 131, north of the original downtown. The buildings are part of a voluntary relocation plan to move homes and buildings to higher ground after two consecutive years of flooding late last decade.

Both buildings are expected to be occupied by December and January. The 15,600 square-foot Mercantile building will use solar and other energy-efficient methods to help house at least 13 business tenants.

The Community Commerce building, about 1,000 square feel smaller than the Mercantile, will house the village hall, library, community meeting area and a community kitchen, which can be used by food processors, caterers and others as an incubator for food businesses.

Combined the buildings cost more than $4 million, but a unique combination of public and private funding is handling it. Plus, indications are that investors and business people in the area are interested in becoming part of the projects.

“We are at 69 percent occupancy at this time,” said Julie Henley, recovery coordinator for the village, during a recent tour of the two buildings, which are in the last stages of construction. “We expect to be at 100 percent by this time next year."

Roof insulation is made of 10-inch structural insulated panels (SIP), which provide an insulation value of R-40. That should lead to a 50 percent savings in heating and cooling costs.

Wall insulation, using insulated concrete forms, has a factor of R-22. The building also will have a heat recovery system, use high-performance fluorescent and LED lights and have other energy efficiencies.

The Community Commerce building has roof insulation of R-38, wall insulation of R-30, a heat recovery system and other energy-efficient features. Perhaps most prominent is a geothermal system, which draws water from 16 vertical wells in the building’s parking lot, takes heat from that water and distributes it around the building using heat pumps.

“You balance users’ needs, safety, budgets with choice of materials and systems in a project like this,” said architect Jan Aslaksen of Cameron Aslaksen Architects LLC, based in Reedsburg. “It was a challenge, but I believe we reached a balance with the project.”

Aslaksen has served as the project coordinator and architect. Wieser Brothers is serving as the general contractor on the Mercantile building and Olympic Builders is serving in a similar capacity for the Community Commerce building.

Funding comes from the Economic Development Administration. FEMA, the USDA and other federal sources, as well as the Department of Commerce and other state sources. Private investment also is involved. The State Energy Office and E3 Coalition, a Viroqua-based consulting firm, also provided assistance.

“It was like making a big stew,” Henley said. “We had all these ingredients, and different funding sources. It was a big challenge to make it work. E3 was a big help as an independent consultant. We managed to bring all the ingredients together.”

Megan Levy of the State Energy Office said the Gays Mills projects are examples of what could be accomplished across the state. “There are 140 communities in the state that have pledged to reduce their energy dependence,” Levy told a gathering after the tour of the buildings. “You have done so much here in Gays Mills.”

The Crawford County Board hopes to meet in the community room of the Community Commerce Building in either December or January. Tenants in the Mercantile building should start moving in during the next few months.

Both buildings are part of a broader relocation effort. A grocery and gas station are housed in a building called The Marketplace, which recently opened just north of the Mercantile building. It too is energy efficient.

Town homes, single family homes and apartments have been built and are occupied on the hillside to the east of Highway 131.

Meanwhile, some business people and residents have opted to remain in the traditional downtown area. The village does not plan to abandon them. Some recreational trails and tourism attractions could still be developed along the Kickapoo River.

Friday, October 28, 2011

MADISON – With the Wisconsin Legislature huddled in the Capitol to debate ideas for improving Wisconsin’s economy, it’s only fitting that some of the companies actually shaping the state’s future will be gathered two blocks away next week.

The annual Wisconsin Early Stage Symposium, which matches up-and-coming companies with potential investors and other partners, will be held Wednesday and Thursday at Madison’s Monona Terrace Convention Center. It will serve as a reminder that Wisconsin’s innovation economy is cranking out ideas that can compete anywhere.

Nearly 40 emerging companies from a mix of industry sectors – biotechnology, software, advanced manufacturing, medical devices and consumer products – will tell their stories to angel and venture capitalists from across Wisconsin and beyond. The conference also features a number of hands-on panel discussions and speakers such as Rich Bendis of Innovation America, one of the nation’s leading startup catalysts.

But the true stars of the event are the companies, who will show up fingers crossed that investors will pay attention to what they have to offer – and actually have the money to invest.

Finding investment dollars for young companies is one of the nagging problems in Wisconsin these days, despite the rise of an innovation economy driven by world-class research, strong talent and a culture that increasingly values entrepreneurism.

While Wisconsin has one of the strongest networks of angel investors in the country, it routinely lags most states in venture capital investments. These are private equity investments that typically bring companies beyond the seed and startup stages and into growth stages that produce enduring economic value and jobs.

Seeding the clouds to attract more private venture capital is an idea that has attracted bipartisan support in the Legislature, but lawmakers now have to wrestle with the fine print of how that can be accomplished. If they want first-hand testimonials about the need, however, they could do no better than to talk to a cross-section of entrepreneurs who want to build their companies in Wisconsin.

The conference line-up includes a lot of what one might expect in a state renowned for its medical technologies. Companies on hand for presentations are developing novel drugs or treatments for cancer, schizophrenia and diabetes; better diagnostics for viruses; advances in ultrasound technologies; and new techniques to relieve muscle pain. Two presenting companies believe they have found a better way to produce a commonly used medical isotope, Molybdenum 99, which is at risk of encountering shortages worldwide.

The conference also includes companies that represent other sectors of Wisconsin’s tech-based economy – sectors that sometimes get overshadowed. Companies selected to pitch next week include:

* A water purification firm that may hold the key to safe extraction of natural gas through hydraulic fracturing, or “fracking,” of shale rock.

* A company that converts customers’ music from CDs into digital files that can be downloaded, sold and traded.

* A company that has produced a new energy drink under the curious name of “Flatt Cola.”

* Two firms involved in producing construction materials that can be used in developing nations, to cope with natural disasters or to make use of wood that would otherwise go to waste.

* A company that has produced a flame retardant material that doesn’t harm the environment.

* A software firm that has already sold one popular mobile video game and will soon release another.

* A company that has developed nano-crystalline diamond coating technology for use in manufacturing and other industries.

* A campus-based company that has developed an online way to change how people give and receive confidential peer support.

Wisconsin entrepreneurs are producing marketable ideas, but getting those companies off the ground isn’t easy. It takes perseverance, the right management and scientific talent, a community of peers who understand the challenges facing startups and enough money to grow.

With the debate over venture capital coming to a head in the Capitol, Exhibit A for why action is urgently needed will be on display next week a short walk away. The Legislature shouldn’t pass a venture capital bill to benefit investors, but it should do so to propel companies that will provide tomorrow’s jobs.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal. Learn more about the Early Stage Symposium at http://www.wisearlystage.com

Thursday, October 27, 2011

Delore Zimmerman likes a lot of what he sees in Wisconsin's economy: its tradition of high-performing, globally competitive companies; its above-average export growth; and what he describes as a "robust" tech-based ecosystem driven by business, university and government.

But he's less optimistic about the ability of Wisconsin – and many other states, for that matter – to break free of two seemingly contradictory trends. The first is nagging unemployment, which stood at 7.8 percent statewide in September and higher nationally, and the gap between available jobs and workers who are qualified to fill them.

"We've got a serious mismatch in our country right now when it comes to our workforce," Zimmerman told a business luncheon in Madison Tuesday, "and Wisconsin is no exception."

Zimmerman was on hand for the Wisconsin Manufacturers & Commerce 100th anniversary luncheon to talk about "Enterprising States," an annual report prepared for the U.S. Chamber of Commerce by Zimmerman and his North Dakota-based consulting group. He said Wisconsin scores well when it comes to most workforce education factors, but employers here are still having a hard time finding the right people for available jobs.

Kurt Bauer, WMC's president, calls it the "workforce paradox," a climate in which many people are still out of work but many jobs are going unfilled.

"Right now, we have a shortage of skilled labor," Bauer said. "It's only going to get worse."

Here are reasons why that grim assessment may be right:

There are shortages of skilled workers in key trades: A survey released Monday by Deloitte & Touche and The Manufacturing Institute indicated that manufacturers across the United States cannot fill an estimated 600,000 jobs, mainly in skilled production areas such as machinists, craft workers and other technicians.

The survey polled 1,123 manufacturing company executives and found that 5 percent of all manufacturing jobs are unfilled due to a dearth of skilled applicants.

Education is partly to blame: One report after another has warned that America's educational system is failing to produce enough science, technology, engineering and math graduates, and that shortage may be finally catching up to the economy. Technical colleges are trying to fill the gap, but too many graduating high-school students don't see skilled trades and STEM jobs as a career path. Parental biases about college degrees play into that phenomenon, as well.

Industry is partly to blame, too: If you lay off people at the first whiff of an economic downturn, or in favor of adding jobs overseas, people eventually get the hint and look for other ways to support themselves and their families. Industry can also do a better job of telling young people that today's production jobs are largely technology based, well-paid and "clean." It's not your father's factory anymore.

Demographics work against Wisconsin: As Zimmerman noted in his report, Wisconsin is an aging state. That means more workers are closer to retirement, or have already retired. That makes it more important to keep young workers at home. "Wisconsin trails the nation in residents 25 to 39, a critical age group for young families and mid-level professionals," the report noted. "With many attractive, mid-sized communities and a relatively affordable cost of living, Wisconsin could be a haven for young families, yet it trails the national average."

Worker mobility is restricted by housing trends: If you can't sell your house in Phoenix or Tampa, it's a lot tougher to take a job in Milwaukee or Green Bay. "Housing handcuffs" are crimping historic migration trends.

The world has changed – but some people won't accept it: Wisconsin must compete in national and global economies that put a premium on skilled workers who can communicate, solve problems, work as part of a team and adapt to change. Workers who don't fit that description or decline to try will increasingly find themselves bypassed by opportunity. Similarly, policymakers who don't grasp the realities of the innovation economy shouldn't be surprised if their states, regions or cities slip further behind.

Endowing our future was an overriding message in Zimmerman's "Enterprising States" report, which stressed investing in education and workforce training, infrastructure, key industries, business start-ups and scale-ups while producing a business-friendly environment.

"A state can neither cut nor tax itself into prosperity," he said. Now, if only our divided political system can reach the same conclusion.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.

Friday, October 14, 2011

LA CROSSE – Darin Buelow of Deloitte Consulting’s Chicago office is a Badger in almost every way that counts. He’s a Madison native, married a Madison native, graduated from UW-Madison and describes himself as a “proud Green Bay Packers shareholder” – an attribute he may not flaunt every day while strolling down on Wacker Drive.

But hailing from Wisconsin doesn’t stop this veteran site selection expert from standing back and assessing the state, warts and all, when it comes to attracting businesses from outside its borders.

Being the Badger with an outsider’s view was Buelow’s role Tuesday when the board of directors for the Wisconsin Economic Development Corp. met to hear about the organization’s approach to fostering economic growth. It’s a plan that will include working with entrepreneurs, cracking into global markets, attracting foreign investment, bolstering community infrastructure and attracting companies and jobs to Wisconsin.

Buelow is a principal in Deloitte’s Real Estate and Location Strategy practice, which works with companies worldwide in determining where they might want to expand, relocate or otherwise grow. He was a co-author of a 2010 study that recommended, among other things, transforming the Wisconsin Department of Commerce into what is now the WEDC.

In La Crosse, he talked about what has taken place since “Be Bold Wisconsin” was written, as well as the state’s strengths and weaknesses when it comes to attracting companies from other states or nations. It wasn’t a monochromatic picture.

Buelow said companies look at a mix of factors when it comes to location decisions, with benchmark operating conditions being business climate rankings; recent project activity; entrepreneurship; education attainment; air access and labor relations. Benchmark operating costs include labor for production; labor related to information technology; taxes; real estate costs; utilities and incentives.

Buelow said Wisconsin’s challenges are not enough venture capital, lack of a statewide “shovel-ready” sites program, moderately influential state incentive programs and generally poor perception as a business destination – whether real or perceived.

While Wisconsin may pride itself on good highways and transportation systems, Buelow said, it’s an “average, at best, solution for most industries.” Why? Lake Michigan is a natural barrier for companies that sometimes choose Indiana, Illinois or Iowa to be closer to suppliers and customers. The state has a low natural disaster risk – but a perception of slow regulatory permitting. While its skilled workforce is an advantage, Buelow said, there is a perception of risk with unionized work stoppages.

Finally, he said, Wisconsin has some new tax and start-up incentives to offer, but they’re not yet well known among corporate site experts.

Buelow listed four examples of companies making site decisions – one in Indiana, one in Illinois and two in Wisconsin. In each case, an “available, suitable site” was instrumental. Each process involved a company looking at dozens if not scores of sites and slowly narrowing the list based on other factors.

The Wisconsin examples were Ingeteam, a Spanish company that selected Milwaukee for a wind generator and solar inverter plant, and SEDA, an Italian cup and packaging manufacturer that selected Racine County. Both were expansion deals closed in the final year of Gov. Jim Doyle’s administration; both are recent examples of how Wisconsin can attract foreign direct investment if it’s paying attention. With more “shovel-ready sites,” Buelow said, Wisconsin could win more of the same.

“We need to do a better job of letting the world know what we have, and how we’re addressing our challenges,” said Paul Jadin, WEDC’s chief executive officer. He said Buelow’s assessment reminded him and board members why WEDC was created in the first place, highlighted gaps in the state’s toolkit – such as venture capital and certified sites – and linked WEDC’s emerging strategies to an unvarnished outside view.

Attracting companies from elsewhere will be less important over time to Wisconsin than growing start-ups in local dirt and retaining those companies that already call Wisconsin home. But in a competitive world where companies decide routinely to be close to their customers, their supply chains or the right workforce, Wisconsin can’t afford to sit on its hands.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.

Thursday, October 13, 2011

Groups raising questions about proposed power lines by American Transmission Company now extend across the state.

From the Kickapoo Valley in the west to Wauwatosa in the Milwaukee area, people are questioning the routes and plans for ATC lines designed to connect wind power and other alternative energy sources west of the Mississippi River with more populated areas in eastern Wisconsin and eventually the Chicago area.

SOUL of the Kickapoo Valley has worked with municipalities in western Wisconsin in raising questions about the “Badger Coulee” line that would run from La Crosse to Madison. ATC has held two rounds of meetings on that 150-mile, 345-kilovolt line and has not yet decided on final routes for it.

The company says the Badger Coulee line would help Wisconsin and the Midwest region by "improving electric system reliability, delivering economic benefits for Wisconsin utilities and electric consumers and expanding infrastructure to support greater use of renewable energy.”

The town of Stark in Vernon County has formed a special committee to work on questioning the Badger Coulee line and looking at alternatives to it. The committee and SOUL, which stands for Save Our Unique Lands, are working with groups that support distance transmission of wind-generated power.

Committee members and others are concerned about the carbon footprint and costs of the Badger Coulee line and are looking at efficiencies and environmental benefits of so-called “startup bundles” of lines for the Midwest.

In recent weeks, the Dellona Town Board in Sauk County joined a growing list of small municipalities raising questions about the Badger Coulee line. Those questions are about environmental concerns, costs, loss of land by private land owners and municipalities, reduced property values and other issues.

“After reviewing the route proposed, the scale of the proposed towers, the unavoidable environmental and economic impacts during the actual construction, and the potential for both temporary and long term environmental and economic damages after construction is completed, the Town Board voted unanimously to vigorously oppose the proposed construction and recommend the transmission line use either an existing easement or follow the I-90-94 corridors for future construction,” Chairman Paul Bremer wrote in a letter to ATC.

ATC hopes the $425 million project could go to the Public Service Commission in 2013 with a PSC decision in 2014. Construction then could start in 2016 with service starting in 2018.

The Badger Coulee line is not the only ATC-proposed line that is raising concerns among citizens’ groups. Nearly 100 interested people recently attended a meeting called by Milwaukee Ald. Michael Murphy to address the ATC proposal to build 138,000-volt power lines though a small neighborhood in Milwaukee and Wauwatosa.

“While we all understand and respect the need for more power, we find it disconcerting that the ATC has proposed burying the high-powered transmission lines underground just blocks away along 92nd street, yet would put them up on 95th street above the heads of parishioners at St. Therese Church, the 420 school children and 90 teachers at Milwaukee Montessori School, the 200 residents of a nearby apartment complex, other neighboring homes, and all of those who currently enjoy Cannon Park,” wrote the Montessori School's Monica Von Aken in a piece posted at the BizTimes Milwaukee website.

Von Aken and others say all lines should be buried in the area. Representatives of the Milwaukee Regional Medical Center and the UWM Foundation, which have investments in the area, have raised questions about overhead lines.

The disputed line is part of the Western Milwaukee County Electric Reliability Project, which would include construction of a new We Energies substation and two 138 KV transmission lines.

“The Highway 45 corridor in western Milwaukee County is a growing metropolitan business hub,” ATC writes on its web site. “According to We Energies’ planning studies, electric demand in this region is projected to double as soon as 2016, beyond the capacity of the existing distribution substations and feeders that serve the area. Key drivers include commercial growth along Watertown Plank Road and increased electric usage by businesses and homes.

“In addition, the critical nature of the two Level 1 trauma centers located within the Milwaukee Regional Medical Complex calls for a higher level of electric service reliability, one that includes a redundant source for electricity in the event that one of the two lines experiences an outage. Two separate and distinct lines are being proposed to serve the new We Energies substation.”

ATC hopes for submission of a plan for the Milwaukee project to the PSC in 2012 with approval in 2013. Construction would start in 2014.

In both the Badger Coulee project and the Milwaukee area project, ATC has maintained that for some projects above-ground lines are more cost-effective and more efficient in transmitting electricity.

The company also has emphasized seeking public input through community meetings and through writing in both projects.

ATC was founded in 2001, as the first multi-state, transmission-only utility in the United States. According to the company web site, “Its transmission system allows energy producers to transport electric power from where it's generated to where it's needed. It's similar to the interstate highway system with high-voltage electricity traveling on the transmission system wires like vehicles on the highway.”

-- Hoffmann has written many columns and features for WisPolitics.com and WisBusiness.com over the years. He will write the GreenBiz column monthly.

Tuesday, October 4, 2011

WASHINGTON, D.C. – At first glance, it’s an unlikely collection of people: Ranchers, farmers, economic development professionals, technologists and small business owners, all descending on the nation’s capital to talk about an issue that might easily get lost among other priorities in Congress.

That issue is improving broadband connections – essentially, high-speed internet connectivity for voice, data and more – in parts of the country that often lack good connections today. For much of rural Wisconsin and similar regions nationwide, adequate broadband service can make the difference between prosperity and stagnation.

A group called “Broadband WORKS for Rural America” has brought that message to Capitol Hill at a time when creating small businesses is crucial to America’s economic growth. Representatives from about 20 states, including Wisconsin, are taking note that U.S. broadband connectivity remains somewhat middle-of-the-road among the world’s developed nations – and that rural America is less connected than the country as a whole.

Wisconsin ranks 43rd among the 50 states when it comes to high-speed Internet access, according to a recent report by the National Telecommunications and Information Administration. A major reason for the state’s lackluster ranking is access in rural Wisconsin, where many telecom providers are trying to swap their historic commitment to land-line service to investments in broadband.

Much like other communities across the United States, rural Wisconsin would benefit from enhanced broadband connections. Here are some reasons why:

* Broadband allows small businesses, which account for most new jobs in Wisconsin, to expand their markets and customer bases to regional, national and even international levels through greater use of eCommerce sales channels.

* It creates more opportunities for creation of businesses related to information technology, one of the fastest-growing segments of the U.S. economy. Wisconsin is 21st among the states in information technology jobs, according to the latest CyberStates survey, and could grow even more in development of software, mobile applications and Internet solutions.

* It enables hospitals and clinics to make better use of telemedicine. Examples include rapidly locating digital medical records and medical images that can be more easily transmitted to doctors or clinics in remote locations. This can save lives and improve health.

* It provides rural Wisconsin residents with greater access to higher education or continued education through “distance learning” systems. These systems themselves can become an export industry for Wisconsin, which has a strong “K-through-gray” education structure and companies engaged in educational software. Why not sell that expertise to others?

* It makes rural Wisconsin more likely to attract large data centers, which are the information storage citadels of today’s IT-driven businesses and corporations. Such centers are essential to Wisconsin’s financial services and health care sectors.

* It will enhance tourism. Wisconsin is a prime tourism destination, but some in the industry find themselves losing opportunities to book sales if their broadband service is slow or erratic.

* It will enhance public safety by allowing more rapid response to emergencies, whether those are medical emergencies, police calls or events related to natural disasters.

So, what’s the message to Congress? Stay the course and give rural America a chance to attract and retain 21st century jobs. While the Obama administration has set a broad national goal of universal broadband deployment by 2016, plans to reach the 30 percent of Americans who can’t tap into broadband are still emerging. Federal grants to rural telecoms have helped, but it will largely be a private-sector endeavor driven by society’s rapid transition into wireless communications.

To that point, it’s a message about clearing old regulatory hurdles and not creating new barriers.

Access to broadband can create jobs for young, well-educated Wisconsin workers who might otherwise need to leave rural Wisconsin to find work. Broadband works – especially if it links rural America with the global economy.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.